Watch CBS News

Loan Modification Help for Military Servicemembers

Bank of America announced plans today to provide additional mortgage protection relief to distressed military personnel and their families.

New programs such as a principal forgiveness loan modification for enlisted men and women who have fallen behind on their mortgage payments, offer the lending institution an opportunity to address the particular challenges facing U.S. soldiers and military support staff.

"Military men and women face extraordinary circumstances, and they make unique sacrifices for all of us. For these reasons, we want this combination of tools to address their needs and help them when they need it most," noted Terry Laughlin, Bank of America executive vice president.

Along with the principal forgiveness loan modification, Bank of America is also offering a reduced 4 percent interest rate on mortgages to personnel who qualify for Servicemembers Civil Relief Act (SCRA) protection.

A dedicated mortgage customer service unit established for military clients will walk interested parties through all of their options. Call toll-free at (888) 325-5357 to get the process started.

Bank of America envisions implementation of the new programs as a series of steps:

  • Beginning with principal forgiveness, borrowers may reduce the amount owed on their mortgage to as little as 100 percent of current market value.
  • If required, an interest rate reduction and extension of loan terms aim to help military customers achieve an affordable mortgage payment.
In an interview, Rick Simon, part of the bank's media relations team, said that the new programs were created in response to ongoing discussions at the lending giant that began last Fall.
"Bank of America has a long-standing commitment to military personnel and has provided them with specialized financial services since 1920. We continually evaluate our programs, and we have been looking at the unique needs of our military customers in today's challenging housing market for several months. The modification program has been under discussion...and is a response to the needs of these customers in their special situation."
Do you think Bank of America's new programs will have an impact on the mortgage hardships facing our armed forces?
To read the full press release, click here.
More on MoneyWatch:
Ilyce R. Glink is the author of several books, including 100 Questions Every First-Time Home Buyer Should Ask and Buy, Close, Move In!. She blogs about money and real estate at and The Equifax Personal Finance Blog, and is Chief Content Strategist at, a community for real estate investors.
View CBS News In
CBS News App Open
Chrome Safari Continue
Be the first to know
Get browser notifications for breaking news, live events, and exclusive reporting.